Turning your Big Idea into a Business
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Turning your Big Idea into a Business

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A look at different web app business models including advertising, freemium and subscription, and the choices that startups face when trying to generate revenue from an application.

A look at different web app business models including advertising, freemium and subscription, and the choices that startups face when trying to generate revenue from an application.

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  • 1. Thursday, 28 May 2009
  • 2. Thursday, 28 May 2009
  • 3. Turning your idea into a business Roan Lavery Thursday, 28 May 2009
  • 4. Thursday, 28 May 2009
  • 5. The plunge Thursday, 28 May 2009
  • 6. Who needs a business model anyway? - Dick Costello, Feedburner http://www.burningdoor.com/askthewizard/ Thursday, 28 May 2009
  • 7. Who needs a business model anyway? - Dick Costello, Feedburner http://www.burningdoor.com/askthewizard/ Thursday, 28 May 2009
  • 8. Who needs a business model anyway? - Dick Costello, Feedburner http://www.burningdoor.com/askthewizard/ Thursday, 28 May 2009
  • 9. Who needs a business model anyway? - Dick Costello, Feedburner http://www.burningdoor.com/askthewizard/ Thursday, 28 May 2009
  • 10. Who needs a business model anyway? - Dick Costello, Feedburner “With this kind of traffic, we'll figure it out” - John Doerr, Google Board http://www.burningdoor.com/askthewizard/ Thursday, 28 May 2009
  • 11. Web app business models Advertising 34% Payments 32% Subscription 14% Long game 6% 3rd party supported 14% http://www.boxuk.com/blog/monetizing-your-web-app-business-models Thursday, 28 May 2009
  • 12. Free love Thursday, 28 May 2009
  • 13. The psychology of free Thursday, 28 May 2009
  • 14. Free love? Critical mass Advertising down User costs Bandwidth Storage Support Scaling Thursday, 28 May 2009
  • 15. “The problem with free is that every time you double the size of your database the cost of maintaining the site grows 6 fold. The bigger you get as a free site the less money you make per visit and the more it costs to service a visit.” - Markus Frind Thursday, 28 May 2009
  • 16. Make ‘em pay Thursday, 28 May 2009
  • 17. Individual ~ x 10 Business Thursday, 28 May 2009
  • 18. Thursday, 28 May 2009
  • 19. 200 users @ £20 per month = £4,000 a month = £48,000 a year Thursday, 28 May 2009
  • 20. 200 users @ £20 per month = £4,000 a month = £48,000 a year 4000 users @ £20 per month = £80,000 a month = £960,000 a year Thursday, 28 May 2009
  • 21. 200 users @ £20 per month = £4,000 a month = £48,000 a year 4000 users @ £20 per month = £80,000 a month = £960,000 a year CHA CHING!! Thursday, 28 May 2009
  • 22. Topical Geographical Thursday, 28 May 2009
  • 23. Topical Freelancers in service industries Geographical Thursday, 28 May 2009
  • 24. Topical Freelancers in service industries Geographical UK based (mostly) Thursday, 28 May 2009
  • 25. http://www.omnisio.com/startupschool08/david-heinemeier-hansson-at-startup-school-08 Thursday, 28 May 2009
  • 26. Freemium Thursday, 28 May 2009
  • 27. conversion rate = 2.5% cost per user = £2 a year Thursday, 28 May 2009
  • 28. conversion rate = 2.5% cost per user = £2 a year Total Users 160,000 Thursday, 28 May 2009
  • 29. conversion rate = 2.5% cost per user = £2 a year Total Users 160,000 4000 paying @ £20 Thursday, 28 May 2009
  • 30. conversion rate = 2.5% cost per user = £2 a year Total Users 160,000 4000 paying @ £20 156,000 free Thursday, 28 May 2009
  • 31. conversion rate = 2.5% cost per user = £2 a year Total Users 160,000 4000 paying @ £20 156,000 free £960,000 - £320,000 = £640,000 Thursday, 28 May 2009
  • 32. March 2007 Thursday, 28 May 2009
  • 33. May 2009 Thursday, 28 May 2009
  • 34. May 2009 there it is! Thursday, 28 May 2009
  • 35. Freemium Subscription + free trial Daily Sign ups Revenue Thursday, 28 May 2009
  • 36. Lessons learned Find your niche audience Charge people! Be careful about what you give away Creative with business models Agile business development Thursday, 28 May 2009
  • 37. Thursday, 28 May 2009
  • 38. Thursday, 28 May 2009
  • 39. Any questions? Roan Lavery roan@freeagentcentral.com follow: @roanlavery & @freeagentapp Attribution http://www.flickr.com/photos/guy_incognito/47600607/ http://www.flickr.com/photos/picsandpics/3395713506/ http://www.flickr.com/photos/digitalsextant/1806620459/ http://www.flickr.com/photos/15589195@N04/2128900152/ http://www.flickr.com/photos/drb62/457354545/ http://www.flickr.com/photos/greenshock/44793290/ http://www.flickr.com/photos/bebebeaux/2956060052/ http://www.flickr.com/photos/undaunted/488622130/ http://www.flickr.com/photos/ihtatho/627226315/ http://www.flickr.com/photos/ciordia/2241906999/ http://www.flickr.com/photos/lucy_baxter/3326890764/ Thursday, 28 May 2009